Author Archives: securities
Diminished Financial Capacity: How to Plan for It and Help Others Who May Have It
The SEC’s Office of Investor Education and Advocacy and the Consumer Financial Protection Bureau recently issued the Investor Bulletin and Advisory: Planning for Diminished Capacity and Illness to address a growing concern for the country’s estimated 44 million adults over the age of 65. Financial Capacity – what is it? Financial capacity is an… Read More »
FINRA’s Regulatory and Examination Priorities for 2015
The Financial Industry Regulatory Authority (“FINRA”) has released its 10th annual Regulatory and Examination Priorities Letter. In this annual open letter, FINRA puts its member firms on notice of the particular issues of importance to FINRA’s regulatory staff. Some highlights of FINRA’s letter are discussed below. FINRA begins by identifying challenges that it says… Read More »
Securities Corner: The Good, The Bad and the Ugly of “ETFs”
Overview The exchange traded fund (ETF) market recently passed a key milestone in 2011 when the total assets invested in ETFs crossed the $1 trillion mark. Despite their growing popularity, many investors are still not sure exactly what ETFs are. As with any investment, it pays to be an educated investor. An ETF is… Read More »
How Do You Know When A Securities Financial Advisor is Breaching His or Her Duties to a Client?
Customers at securities brokerage firms often assume a financial advisor will invest the client’s assets in a manner that is safe and in the client’s best interests. But what many clients do not know is that they may be exposing their accounts to unnecessary risk or even abuse. Whether through intentional misconduct, negligence, or… Read More »
Market Correction: Time to Take “Stock” of Your Portfolio
As every experienced investor knows, the stock market is cyclical. Just like the old adage, “whatever goes up must come down.” What is not a sure thing, however, is the effect that a market downturn will have on your portfolio. Investors, who are well informed about what is going on in their accounts, are… Read More »
Guidelines for Communicating with the Public regarding Unlisted Real Estate Investments
FINRA recently concluded that communications made by broker-dealer firms (“firms”) to potential investors regarding unlisted real estate programs often fall short of FINRA Rule 2210, which requires that such communications be fair, balanced, and not misleading. As a result, FINRA has developed guidelines to assist firms when communicating with investors about two common types… Read More »
Selling or Investing in Pension and Structured Settlement Income Streams
Individuals with income streams from pensions or structured settlements are being solicited by companies who purchase the right to these income streams in exchange for a discounted lump-sum payment of the total annuity amount. Although the prospect of receiving one large lump-sum payment often seems more enticing than collecting several smaller periodic payments, the… Read More »
Thumbs Up Or Down? The Year In Review For FINRA And The SEC
As we proceed into 2012, we have reviewed some of the matters that the Financial Industry Regulatory Authority (FINRA) and Securities and Exchange Commission (SEC) have done well or not so well. Here are our top-five areas in which FINRA and the SEC deserve a thumbs up or thumbs down. Thumbs Up Launch Of… Read More »
Does a “Finder” of Corporate Financing Need to Register Under the Securities Laws to be Compensated?
When a business seeks to raise capital, many use third parties to find investors and serve as an intermediary between investors and the company, as an issuer of securities. Such intermediaries are generally referred to as “finders.” In this scenario, both the company and finder need to be wary of whether the finder meets… Read More »
Is Your Financial Advisor a Fiduciary or an Order Taker?
As a general rule, financial advisors fall into two categories: (1) brokers, who are registered under the Securities Act of 1934, and (2) investment advisors, who are registered under the Investment Advisors Act of 1940 (“IAA”). Investment advisors are subject to higher standards of regulation and licensing than brokers, and accordingly, investment advisors owe… Read More »